Update: June 18, 2021: Teampay, a corporate expense management company, has launched a digital-first business expense debit card in partnership with card network giant Mastercard, according to the June 16 press release.
The Catalyst by Teampay card tracks expenses and is instantly available digitally after being issued by the company through Apple wallet. Though users can also use a metal card option available for “longevity, rigidity and sustainability” reasons, Teampay CEO Andrew Hoag said in an interview. The numberless card can generate a unique 16-digit card number "on demand so you have disposable card numbers,” to reduce the chance of credentials getting stolen, he said.
The card offering is targeted towards “vice presidents and C-suite executives” and the company has the option to provide unlimited access to a corporate account, Hoag said. “There's no transaction limits on it and so this card is really focused on the people who are the spending authority of the company,” he said.
- Teampay, a New York-based spend management software company, plans to expand its operations into Canada by the end of the year after seeing a surge in its user base and revenue during the pandemic.
- The company also aims to partner with a major card network to issue corporate card options in the second quarter of 2021.
- Despite the COVID-19 impact, business spend management software companies experienced significant growth. According to a WiseGuy research, the global market for business spend management (BSM) software was $7.04 bn in 2018 and is expected to grow at a compound annual growth rate (CAGR) of 10.5% during the forecast period from 2019 to 2024.
Teampay saw its user base increase by nearly 60% over the last 12 months, Teampay CEO Andrew Hoag told Payments Dive.
The company helps businesses automate their invoices, reduce procurement costs and manage their operating costs by giving employees purchasing power, rather than a centralized purchasing procedure. The pandemic accelerated the market adoption of this software, Hoag said.
"We were in an era with the bull market where capital was effectively free," Hoag said. "Last year with the pandemic and kind of the shift in the economy, capital was no longer free and I think companies have now woken up to the need to actually control that."
The company saw dramatic growth adoption rates of their products in upper and mid-market-sized organizations. Teampay classifies the upper-market as organizations with more than 2,000 employees, while mid-market companies have 200 to 2,000 employees.
Larger companies that would have waited for years to put in a system like this were quick to partner with Teampay to manage their expenses, Hoag said.
Nearly $700 million flows through Teampay’s spend management system, and along with invoicing and payments flow, the total is more than $1 billion annually.
The company has raised $21 million in total since its inception in 2016, with $18 million through Series-A-extended rounds and $3 million of debt.
With a major card provider partnership on the horizon in the second quarter this year, Teampay aims to become one of the first corporate card providers in the BMS space. Teampay offers its own physical and virtual cards, and has the ability to integrate with customers' existing credit lines at different banking institutions like Silicon Valley Bank. Additionally, the company is in talks with other larger commercial banks to expand credit offerings, Hoag said.
Teampay partnered with Amazon Business to streamline employees' purchasing procedures on Amazon, and also launched multi-currency payment solutions for their customers during the pandemic. The company also plans to expand operations into Canada by the end of the year after experiencing success with their multi-currency payment approach, Hoag said.
Payhawk, a London-based BMS provider for businesses, launched exchange rates at a relatively low 0.9% when paying in foreign currencies last year.
That rate and the easy-to-use portal "turned out to be very popular [with Payhawk customers] as most of the company spend moved online, where companies are forced to pay subscriptions and ads in multiple currencies," Hristo Borisov, CEO of Payhawk, told Payments Dive.
Payhawk's platform's monthly revenue grew 10 times due to their multi-currency payment option, and as businesses looked to cut down operating costs. The company has raised €3.6m since its inception in 2018 and recently partnered with Railsbank to launch one-click bill payments and reimbursements.
Payhawk is also working on a Visa commercial company card that comes with exchange rates and cross-border payment capabilities. The company aims to penetrate the U.S. market by the end of the year, Borisov said.
Providing small businesses with tools for cash flow management and revolving credit lines helps those companies manage and save costs, said Brandon Rembe, Chief Product Officer at Envestnet.
"We've seen a big uptick in the spend management services not only for the consumers but also in the small business space," Rembe said. "We continue to get demand for that type of accounting software like predictive cash flow analysis, how much they need to borrow and when they will need to borrow."
Clarification: Teampay clarified its relationship to Silicon Valley Bank.